4 steps to financial freedom from regular income
High income or a 7 figure salary does not always lead to financial freedom. The truth is most wealthy people in this world have accumulated wealth over a period of time rather than from a single event.
While it might seem incredibly difficult, it takes practice and marginal change in attitude/lifestyle to achieve this. This article describes a few simple tricks to get you started on the journey to get rich and wealthy.
Don’t wait for your paycheck
The first step towards financial freedom is not waiting for your paycheck. The first question that springs to your mind should be how can this be possible?
Most people who spend their money unwisely, spend it right after they get their paycheck on things that satisfy their short term desires. While this may bring you short term happiness this is not a recipe for long term financial freedom.
But how can one not depend on their paycheck? Not depending on your paycheck doesn’t mean not using it but rather not depending on it to make a purchase. If you are going to make splashy purchases on every paycheck, then you will have to think long and hard about your financial freedom and if it is something you really want.
This is the first lifestyle change that you need to make. Make sure you get your rent or credit card debt covered for the next few months without depending on your paycheck. This is the first true step towards financial freedom and let us see how this can be achieved.
Looking for alternative sources of income
While a paycheck is stable and good, I cannot emphasize enough, the importance of having another source of income. Having a good full-time job is nice to have but if you wish to lead a debt-free lifestyle in the long term, you should be willing to shed some of your luxuries now rather than at a later stage of your life. This means finding ways to make alternative sources of income other than your main paycheck.
It would be a good idea to allocate a certain amount of time every day to work on a craft or side hustle that can grant you financial freedom.
This can be anything of interest to you and you have to build it up strong enough that even if you have to give up your full-time job the side hustle would be good enough to take care of your day to day expenses like food or rent.
Just think about how awesome it would be for you to have a source of income besides your paycheck, even if it is only $300 or $400 a month.
Split your paycheck to Savings
This is a nifty little trick that can work wonders for you in the long run. Say you make $3000 a month in your regular job, it can be more or it can be less. Create a separate savings account where you put 10% of your salary every month and forget about it. So $300 a month would turn out to be $3600 at the end of the year, no kidding!
The best part is if you have your salary deposited in your personal account every month, you can ask your employer to split your salary to two different accounts. Now once you put that $300 away, you would still find ways to run your life with the remaining money, but if you think you can save money after your expenses and then deposit it into your savings account, trust me, that is not going to happen.
Start investing with whatever you have
Most people think investing money requires a lot of capital and would be of no use to start investing with a small amount. There can be nothing farther away from the truth. Investing is the primary wealth builder. Even if you can invest less than a hundred dollars every month, it can make a significant impact in the long run.
There are many forms of investing from bonds to mutual funds to stocks markets and so on. I prefer investing in the stock market and it is the easiest for me to do. There are a lot of apps/sites which can help you start investing (Leave a comment if you want me to write an article on this) from as little as few pennies. Maybe sacrifice a branded coffee to make your own coffee instead to get that investment for the first month.
Do a little research on how you want to invest the money, talk to an advisor if need be or there are a lot of self-help finance blogs to guide you through, but get started. Because once you get started, it becomes a habit.
A lot of people are of the opinion that the rich people are rich since they make a lot of money. But this is not always true. Of course, high income plays a part, but the main reason behind achieving financial freedom is being financially sound.
Once you figure out a way to achieve financial freedom, you can become wealthy without any miracle! I am planning to write down a series of articles detailing different ways to save without affecting your lifestyle much, please leave a clap and comment if you find this article helpful and would like more in this personal finance series! Go secure that bag!
